The UK release was one of the earliest albums on the Island Records label. This edition had a color gatefold cover and included 10 songs, but left out hit songs from early Traffic singles. The sitar, an instrument widely associated with this era of Traffic due to its use on the singles "Paper Sun" and "Hole in My Shoe", is used on only one track on the UK album, "Utterly Simple".

The first US version was released in early 1968 by United Artists Records and re-titled Heaven Is in Your Mind. It featured a different non-gatefold cover showing three members of the group without Mason. For this edition, a short looping snippet of the single "Here We Go Round The Mulberry Bush" was added between most of the songs. The US LP was re-sequenced and also added three other singles ("Paper Sun", "Hole in My Shoe", and "Smiling Phases") but deleted two Mason songs ("Hope I Never Find Me There" and "Utterly Simple".) The final track on the US album, "We're A Fade, You Missed This", is actually the ending of the full length "Paper Sun".

The title of the US album was quickly changed back to Mr. Fantasy, but the new cover and track list remained until United Artists went out of business and Island reissued the UK stereo version in the United States in 1980. This edition was also released as Mr. Fantasy in Australia and New Zealand by Festival Records. The first Canadian edition was based on the US album, but dropped two songs. This was released in a unique cover with the title Reaping but replaced by the UK stereo album in 1970.

Both UK and US albums were released in significantly different stereo and mono mixes. This led to four distinct variations of the album. All of these have been re-issued on CD. The 1999 UK re-issue features the UK version in stereo and the US album in mono. In 2000 the US stereo version was re-issued on CD with its original title Heaven Is in Your Mind plus stereo bonus tracks. The same year the UK mono version was also released in the US as Mr. Fantasy with mono bonus tracks.

The song "Giving to You", was released in 3 different versions. The first was a mono B-side with lyrics in the introduction sung by Winwood. This also appeared on the US mono LP. The mono and stereo UK albums had a revised version without singing in the introduction, which was released on the US stereo album. The soundtrack album for Here We Go Round the Mulberry Bush also contains a different recording of "Utterly Simple" than the one used on this album.

A review in the Apr 27, 1968 edition of Rolling Stone called the album "one of the best from any contemporary group". The reviewer felt that Steve Winwood's voice had "matured, acquired new depth and new reaches, a more individual feeling and a greater range in both style and tones", and considered that "the strongest points of this album are where the elements of Traffic's 'comprehensible far-out' and Winwood's great R&B style are combined", but deemed Mason's contributions to be good enough in their own right.[6]

Allmusic's retrospective review is positive, calling Traffic's music "eclectic, combining their background in British pop with a taste for the comic and dance hall styles of Sgt. Pepper, Indian music, and blues-rock jamming".[7]
In 1999 the album was added to the Grammy Hall of Fame.[citation needed]